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The State of Customer Success – Learnings from Pulse 2017

This year I attended Pulse 2017 in San Francisco – a three day event run by Gainsight. A massive event for this nascent industry with over 4,000 attendees. Gainsight is gaining traction and on the first day of the event they announced a new round of investment at $52M. The article explains how you could see Gainsight as a bellwether for the industry and also the practice to some degree.

My first day I joined the entire customer success team from my company Percolate in a training session that lasted a day. The entire trip was spent with the team and that was such an amazing part of the experience and highly recommended. On the 4th day we spent half a day in a team offsite and part of it was dedicated to bringing the learnings from Pulse into our organisation. Several projects have been spun off as a result so very worthwhile on so many levels, not least a great bonding opportunity.

The training was run by Success Hacker, a customer success training, recruiting and service consultancy. The theme for the training was “Predictable Success = Predictable Revenue,” which I thought was pretty representative of the conference as a whole.

The training was intended to be a level-set for our team as well as all the attendees, to get us all on the same page. It was basic in nature, introductory level stuff. I understand why they took this approach but having been practicing customer success for at least 5 years this was rather too basic for me and many of my colleagues.

There were several trends or themes covered at the conference which I synthesise below but first let me recap on some of the best and new learning from the trainings.

Training Day

Success planning

A road trip analogy was used to intro this – the customer is the driver, the CSM is the navigator – I liked that. Success planning was deemed mostly relevant for larger accounts – it’s not scalable for smaller accounts. There was talk of automating this but no real insights how. I had an idea that survey type forms could be useful for getting customer input – a good way to scale.

Challenges to success planning are typically that there is not enough time, info or value (seen in the planning) for it. Benefits and best practice are that it makes you proactive and it is best when plans are shared with customers (I would say co-created) and are kept updated.

They went through a very simplistic overview of what it contains starting with an exec summary. That was probably the most useful piece of advice. Instead though I would offer up the use of a Success Canvas.

Metrics

We went through the meanings of some standard SaaS metric acronyms. They touched on business metrics that often went beyond customer success. This was inane. Any number of the excellent posts on a standard Google search would have done better. This was a total waste of time.

Just a few metrics or measures of performance very specific to customer success worth pointing out were:

Building a customer-centric view in your organization

That should probably have read “building a customer success centric view” because that’s where most of the work is required. Customer centricity is old hat (though still far from well-served), customer success and its unique role in SaaS companies isn’t. Building a good understanding of the role and its contribution to overall company success is key and something I have struggled with before. This actually stood out as a common theme and challenge at the conference. But on to what we covered – some useful nuggets there (with some creative interpretation by me):

Avoid inside out thinking. Think first and always from the customer’s perspectives not your internal processes and approaches.

Avoid solving for the average customer. Try and think in segments at least. Scale can be a challenge here.

Prospect preference. Avoid developing features for new customers ahead of existing.

Shiny thing syndrome. Think impact, not feature / function.

The solution isn’t a process its a mindset and needs to become habit.

Invite customers into “virtual” decision making – “What would the customer think” about an internal decision. “How would this impact the customer?”

How to lead change:

Invite teams to customer visits

Invite customers to your office for lunch and learn sessions. I would go much further and suggest customer meetups which I have written about and worked on setting up at Percolate and they are now taking off.

Invite customers to internal all hands sessions to talk to all employees

Collect and share customer success stories. We have an awesome database built and maintained by our customer marketing team at Percolate.

Applying a consultative approach with customers

There’s consultative selling, so why not consultative customer success? I like the thinking – here’s the upshot:

There are two primary approaches:

Boiler man – fixed, package solutions. Less time consuming and open ended and more scalable.

Wing man – help guide customers to the right solutions. A more custom and suitable fit to customer need but more intensive.

Try solve biggest the problems not the easiest problems.

Focus on selling a solution, not just a feature.

Key skills

Storytelling – effective way to convey by example.

Active listening – improves mutual understanding.

Strategies to manage accounts

Help your customers support their customers better – think of the end customer. I cannot stress this often overlooked approach enough.

Make your customer contacts look good in front of their superiors. Another sure fire way to ingrain yourself in the business through key stakeholders.The converse of this last point – this is my view not covered in training – is that you shouldn’t get single threaded in case that person leaves. So always broaden your stakeholder base beyond one.

Create internal subject matter experts and champions on your solution. Take a train the trainer approach – make them super-users. I wrote about this here: Building user success managers.

Always try and set beatable expectations – like Amazon deliveries. Great idea and benchmark.

Keep up with whats happening in their industry and organisation. A few Google alerts can work wonders.

Become a trusted advisor and act like a partner and not a vendor. What’s needed:

Domain knowledge (their domain) – read industry publications

Customer knowledge (organisational) – be sure to check out their annual report

Product expertise

Business acumen

Change management

This wasn’t separated out, I have here and felt it should have been in the training. It was glossed over. Although I emphasise innovation strategy over change (Innovation is the why, change is the how), at the very least successful technology adoption needs some change management element. Main take outs were:

Training is not enough, nor is marketing and comms.

Internal leaders and stakeholders at a customer organisation need to be involved.

The best presentations that shone a light on the state of the industry

I saw some excellent, top quality presentations at Pusle 2017. Gainsight has also made every presentation and the audio from it available here. Below are the takeaways from me from the best ones I attended.

Before I go into my views though I should point out the trends the CEO of Gainsight (Nick Mehta) shared based on running the last 3 years of Pulse conferences (2015 – 2017). I’ve combined them conveniently side by side above but slides are here and audio here for more. Trends from 2017 are pasted below with a small comment from me.

Partner With IT. I tend to agree with this whereas once I would have said, whatever it takes to embed yourself in the business do it, including ignoring IT. But I’ve learned you can get much further partnering with them.

Extend To The Real World. This has a lot to do with the Internet of Things and customer success moving out of its traditional home in SaaS companies where they become custodians of the entire customer experience. This HBR article co-authored by Michael Porter, one of the world’s foremost experts on strategy and competition, covers it well How Smart, Connected Products Are Transforming Companies (see section covering customer success).

Scale Through Your Partners. I observed first hand how Microsoft, who already has a formidable partner network, tried to embed customer success and technology adoption through its partner network. Its a massive challenge for such a large organisation and network but they have serious intent and I’ve seen it work well with some early stage successes. Cisco was also held up as an example of this approach.

Invest In Your Community. A point was made by Nick Mehta that part of the funding they had just recived was going to be about building the community. He mentioned expanding on their PulseLocal efforts which they started on way back in 2014. I’m looking forward to joining their London chapter. I also see this as a focus area for specific company CS efforts – building a community of customers, partners and employees starting with customer meetups as I covered under point 2.

McKinsey’s Customer Success Benchmark study – main findings

This was a lunch and learn session where two of the study’s main authors went through their main findings. Definitely one of the highlights for me. The fact that McKinsey is putting so much effort into this says a lot in itself. Slides here and audio here. My takeaways as follows:

Value of Customer Success is realised far better with an integrated approach, not in isolation (slide 3 – see above). That is, part of a broader customer experience journey and aligned with full business strategy, not just as a “go to market” strategy.

When setting KPI’s pick the right metric (churn, NPS, etc.) then the parts of the journey that are key to drive impact. Churn is the most prevalent KPI.

Most organizations do not allow enough time for real results. I’ve seen this time and again – many are too eager for results, too early on. True success takes time.

CS needs to have a seat at the product table and play a quarterback role. The CS and product teams presentation I cover further down expands on this.

Onboarding and product experience are by far the most important journeys, yet product teams are rarely involved in driving customer experience / customer success.

Centralised governance from the top down is key. Centralized accountability and governance drives a big lift in value according to respondents. A single “integrating leader” to track and manage end-to-end is required.

Guided journeys automated throughout the journey lead to insights for success plans

People are still key for success despite digital automation. Automation is definitely an important element going forward but customer success is still predominantly about people and relationships.

Adobe – fostering a culture of innovation through customer success

This was one of the first presentations from an organisation adopting customer success practices successfully (slides here and audio here). These are always best in my view. Just as with customer success, examples of success are the best way of learning from and perpetuating further success. Adobe was the first I saw but I’ve included the best from the others. Their key points:

Lots of experimentation – try something see if it works. You should make space for this and invest in it. Love this and my success planning approach is all about experimentation.

Best CS teams focus on specific and different aspects of customer lifecycle (team broken up into specialisms). Also don’t ask a non technical CSM to emphasise product, for example. Or no sales skill but needs to renew.

Ok to lose customers if you understand why – not if you don’t.

Fastrack at Microsoft Office 365

I worked at Microsoft on this approach with Mike Grafham who presented and has his own take of main learnings from Pulse 2017. So I had to attend this session to see how things had progressed since leaving Microsoft (slides here and audio here). I wasn’t disappointed. The main thing is that the focus on scale with such a large customer base continues to be the driver of activities.

What stood out for me was the approach to qualifying customers before they come into the CS pipeline. It’s the first lesson he shared – slide 3. I love this approach and funnel which again borrows from another discipline – the best sales practices.

Bessemer Ventures – state of the cloud (customer success edition)

This was a solid session on the overall state of the cloud (slides here and audio here). The relevant part started with the startling statistic linking improvement in churn with an increase in company valuation.

They also pointed out that of the multiple ways to be successful, upselling existing customers is the major driver.

Working with Your Product Team to Drive User Success

Becky Banasik of TrendKite, Katie Leighton and Nicole Salzman of Box were part of a panel discussion moderated by Todd Olson of Pendo. No slides but audio here and my notes below. In essence, cooperation between product and CS teams was seen as critical to customer success. Since I believe CS teams are the window to product for customers and vice versa, this was heartening.

I love that Box have built a tool to get customer success feedback to product teams. Before a feature is built, CS and sales are asked if they think customers would value it.

At TrendKite features are evaluated on the basis of potential impact on usage, revenue and retention. CS own NPS scores but account managers are responsible for outreach.

At Box product and CS teams both co-own NPS scores. No compensation is tied to NPS at Box but it is at TrendKite.

Based on product usage trends, both spoke about how triggers are sent to CS teams, e.g. when usage drops off or spikes in a specific area. This links to play books for CS to respond to customers. This tied in with what HubSpot does.

At Box, CS and product teams work on new feature releases to come up with a common strategy and comms to set up the release for success.

The panel chair asked whether either involved product teams in onboarding sessions to learn from the user experience. Neither Box or TrendKite do but great idea I thought.

NPS and retention rates are key measures they all used. NPS covered product, brand and company measures.

Use of industry benchmarks was made to judge success, not just improvements over time.

The whole company owns NPS but CS is seen as the cheerleader.

CSAT (customer satisfaction) was also used at Lever. And they try and give various team members (not just CS) specific targets that are actionable.

Role of marketing in CS was discussed. CSM’s feedback customer messaging to marketing to use in campaigns instead of generic and bland marketing messages. Head of customer marketing should sit within the CS org and a budget should go to it from marketing.

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